The March real estate market in Houston was resilient despite steadily rising mortgage rates since the beginning of the year. Although home listings have started to hit the market at a more rapid pace, buyers continue to gobble them up as soon as they hit the market. Multiple offers remain the norm in most Houston neighborhoods as home prices hit record highs.
According to the latest report from the Houston Association of Realtors (HAR), 9,693 single-family homes were sold in March compared to 9,309 last March for a 4.1 percent increase. Homes priced between $500,000 and $1 million led the way in sales for the month, registering a 36.1 percent year-over-year gain. The $250,000 to $500,000 housing segment came in second place, climbing 24.0 percent.
As they did in February, home prices continued their rise through March. According to HAR, continued tight inventory levels are pushing many buyers either into higher price points or causing multiple offer bidding in many neighborhoods. This environment has continued to cause prices to rise. The average price of a single-family home rose 11.4 percent to $410,923 while the median price jumped 15.5 percent to $335,000. This marks the first time that pricing for a single-family home in Houston has surpassed $400,000.
As a result of the high demand from home buyers, total active listings, or the total number of available properties, fell 2.1 percent. March sales of all property types totaled 12,149, up 4.3% compared to the same month last year. As a result, the absorption rate for March 2022 was 58 percent! That’s a 10-year high for March.
Days on Market (DOM), or the actual time it took to sell a home, has fallen for the first time in a few months. In March, the average home sold in 38 days, which is still lower than the 46 days on market we saw last March. Single-family home inventory remained flat at 1.3 months. This is the same level it was both last month and last March. It also matches the historic low that inventory maintained from March through May of 2021. For comparison, housing inventory nationally is at a 1.7-months supply, according to the latest report from the National Association of REALTORS (NAR).
Although we have seen mortgage rates have hit levels not seen since 2009. the real estate market in Houston is thought to continue at the current levels at least into the Summer months. The Houston economy continues to perform quite well, which should help keep inventory levels pretty tight, even as both inflation and rates rise. For aspiring buyers and sellers, this should be a time to evaluate your options so you can decide when you should get started with your sale. The national and local economies remain very volatile and it will pay to be both diligent and patient as you find the timing that works best for you and your local market.